No One’s Scared of the Bears

The market’s bears, once master persuaders that could pressure down stocks on whim, seem to have lost their mojo, Cramer said Wednesday. Because even despite a flurry of bad news, they couldn’t convince the rest of us to sell our stocks.

This idea of what Cramer calls “negative pin-action” is that idea that a gloomy story in the press, an ugly earnings report or a bad data point ripples out to affects entire groups of stocks, bringing them lower. It’s a common thing, but the bears just couldn’t pull it off today.

Xilinx , a chipmaker at the hear of communications and networking, on Tuesday dramatically cut its sales forecast for next quarter, an announcement that would typically hurt companies sectorwide. Instead, the stock finished 22 cents higher after an initial dip, while close competitor Altera close up as well. Even the once-great Cisco , though the company has faltered in Cramer’s eyes, added 3 cents to its share price on Wednesday, and this is a big client of Xilinx.

We saw the same kind of thing in Nike , where a disappointing quarter managed to reach Under Armour but Dick’s Sporting Goods , where Nikes are sold en masse, rallied for much of the day. Even Footlocker , another big Nike seller, lost just 27 cents.

Look, too, at the existing-home sales number, more bad news that failed to produce any significant affect on stocks. In fact, the housing index broke out on the news, Cramer said.

Meanwhile, the bulls are bowling strikes. In the face of constant negativity, the bank stocks are pushing higher. JPMorgan Chase , Wells Fargo and Bank of America all ran today. And recently we’ve seen M&A activity in the group, as evidenced by the takeover bids for Marshall & Ilsley and Whitney Holding. Plus, Huntington Bancshares spiked after issues shares in a secondary. Stocks are supposed to go down on new supply, not up.

So what’s the takeaway?

“Pin action can define a market,” Cramer said, “and the lack of value-destroying follow-through on bad news, the inability of the bears to extrapolate from negative data points and get you to sell your stocks in a blind panic—it has now become the hallmark of this market.”

When this story published, Cramer’s charitable trust owned Bank of America and JPMorgan Chase.